tv First Business KICU April 4, 2013 4:00am-4:30am PDT
facebook throws a new line to investors today with its next step into the mobile market. in today's cover story, new questions and answers as the switch to a new healthcare system moves closer. and, breaking up is hard to do - especially when you're rich and famous. plus, will the return of the dinasours bring jurrasic-sized ticket sales at the box office? first business starts now! you're watching first business: financial news, analysis, and today's investment ideas. good morning. it's thursday, april 4th. i'm angela miles. in today's first look: wall street on a selling spree: there was across-the-board selling wednesday as traders found several reasons to lock in profits, pushing down stocks and commodities.
troubled waters for canival's triumph. the ship broke away from a port in alabama and drifted across a river. it's the same ship that left passengers stranded on the ocean. one worker was missing following the mishap. and president obama is taking a 5% pay cut, retroactive to march 1st, in solidarity with federal workers who are losing thier jobs due to sequestration. over ten months it amounts to 17 grand. todd horwitz of the adam mesh group joins us now for a closer look at today's trading action. todd, this one could get interesting. we had that major sell-off yesterday. does that have to do with the fed possibly ending the bond buyback program? - good morning. you know, i think that more than the bond buyback program, because the treasuries were significantly higher yesterday, i think what you really want to take a look at is the action indexes such as the russell. the russell sold off 4% this week already, which was indicating that the market was looking for a reason to sell. mcdonald's and johnson
and johnson have been getting a lot of action to the upside, and those are not the stocks that are going to lead this next bull leg up. i think what you really want to look at is the market is ready and due for a correction. we went up, made that all-time high, and it looks like it wants to go lower here now. - gold is down about $250 just in the last nine months or so. has the glitter gone from gold? - you know, cold is at a real key spot here. $1,550 is a level that we have been watching for quite a while. if we break below there, it looks like we are going back into the $1,400s. but if you look at the longer- term trend of gold, since it hit its double-top high of $1,900, it has been in a solid downtrend anyway, and right now i think that every opportunity gold rallies should be a spot to take profit or sell. - and what about this north korea situation? it looks like the u.s. is ramping up by sending missiles into guam. are defense stocks, is that a sector you want to be in right now?
- i think that is where you are seeing a lot of the money flow, into defense stocks, real defense stocks and then defensive stocks as well. it is something to watch out for. but this news, like all news, it will be overreacted to, and it will blow over, and then the normal trading will resume. - thanks for being on the show today. we appreciate it. - thank you. 90% of americans don't know that health exchanges to enroll in coverage under the affordable care act open less than six months from now on october 1st. our cover story found that's only the first of many questions still unanswered as to how health reforms will be implimented. health exchanges - nine out of ten americans don't know enrollment starts october 1st. "it does surprise me, but then i'm one of the 90% who don't know about it." october 1st is the day you can sign up for coverage that begins next january. but the director of the non-profit health and disability advocates says there's no need to panic - not yet. "this summer you'll see ads that'll help people get informed and get ready for open enrollment october 1st." this week, the centers for
medicare and medicaid services - cms - says it will hire and train "navigators" to guide the public in choosing a health plan in four catagories of coverage and cost, dubbed platinum, gold, silver and bronze. "right now, the premium prices are unknown, but people who make up to four times the poverty rate will get help on a sliding scale." one delay has already been announced - small business owners will choose the level of coverage but had hoped to allow
workers to choose plans within that level. instead, for the first year, workers will be limited to one plan within that coverage level. in cyprus, unionized bank employes plan to stop working for 2 hours today. it's in protest of an international bailout that could mean large losses to their pensions. under terms of the deal, their retirement money may be heavily taxed. yesterday, the international monetary fund agreed to contribune $1 billion to the bailout package. the rest of the $9 billion will come from the eurozone. that's if cyprus officials sign off on strict budget measures by the end of the month. in a teasingly vague invitation that silicon valley is getting really good at, facebook wants guests to "see our new home on android" - details to be unveiled later today. tech analyst rob enderle thinks the social search-and-like site will announce a propriety application paired with smartphone underachiever htc: "it looks like htc, with facebook's help, is going to announce a co-branded product.
tough sell for htc, which is being outmarketed by samsung and is fighting to return to relevence." if that is, in fact, the pairing. enderle thinks it's a risky move because if sales of the phone tank, facebook takes a hit too. by the way, if you remember albums and eight- tracks, there's this - the mobile phone just turned 40 years old. a picture of yet another tech company developing "smart glasses" has been leaked on the internet. this photo shows what is said to be a man wearing glasses produced by baidu. baidu is the chinese version of google. similar to google glasses, "baidu eye" will have a small lcd screen and be able to livestream images and perform computing tasks. the chinese tech company tells reuters the device may or may not be sold commercially.
bp is powering down its wind farm business to focus on fossil fuels. bp plans to sell interests in 16 wind farms with assets of more than $5 billion. profits will partially help to pay for the 2010 oil spill, estimated to cost the company about $42 billion in recovery efforts. the sale could allow international investors into the u.s. wind market. bp says it will consider all attractive offers. the ceo of exxon mobil tells reporters in houston he's "proud" of the company's handling of the oil spill in arkansas. last weekend, exxon's pegasus pipeline ruptured, pouring out 5,000 barrels of crude oil near little rock, arkansas. 30 minutes after the spill, emergency responders were on site. the ceo says exxon will pay for the damage; however, no timetable was given. the arkansas attorney general is moving forward with an investigation into the incident. in a check-up on ceo pay, the head of cable programmer
discovery communications reportedly took home a cool $49 million in 2012, down from $52 million the previous year. jc penney ceo ron johnson's pay package was severed by 96%, going from $50 million to $1.9 million, after the retailer faced continuing problems. and former wellpoint ceo angela braly received $20 million in compensation, despite resigning under pressure in august. a former goldman sachs trader faces up to 20 years in prison after pleading guilty to wire fraud. matthew taylor surrendered to the fbi wednesday. the cftc accused him in november 2012 of hiding an $8-billion position on a futures contract that cost goldman more than $118 million. his bond is set for $750,000. defense stocks are rallying in the face of sequestration. since march 1st, boeing's stock is up 9.6%. lockheed martin has gained 8.3%. northrop grumman and raytheon are both up 6%.
analysts sense it's a relief rally considering defense stocks took a hit on sequestion deadline fears. thehill.com reports the real threat is in september, when budget cuts take effect. generic versions of blockbuster perscription drugs may be overpriced at some pharmacies. consumer reports sent secret shoppers into 200 pharamcies. they checked prices on copycats of actos, lexapro, lipitor, plavix and singulair. the survey found cvs charging $150 per month for generic cholesterol drug lipitor, which sold at costco for $17. cvs calls the survey too small to draw conclusions. consumer reports advises it's best to shop around when buying meds. apartment buildings are seeing a lot of action these days. apartment vacancy rates have hit their lowest levels in over
a decade. vacancy rates hit 4.3% in the 4th quarter, the lowest since 2001. rents nudged up slightly; however, a study by reis real estate says stagnant income growth has slowed landlords from upping the rent on tenants. more americans are moving on up! around 5% more households moved this year compared to last year, according to a survey by the american moving & storage association. a stronger economy and housing market are listed as reasons to relocate, along with wanting a better home or neighborhood, and in some cases a new job. disney is hoping it will find sequel success with help from a forgetful fish. disney announced its follow up to "finding nemo," "finding dory," will hit theaters in 2015. twitter and facebook exploded with comments from fans this week. in 2001, "finding nemo" brought in a billion dollars worldwide. another sequel may help give disney shares a bounce. "monsters university," sequel to "monsters inc.," hits theaters this summer.
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pre-nuptual agreements are back in the news. michael jordan and his bride-to-be have signed one. and then there is harold hamm. he is number 35 on forbes list of richest americans, and boy, he'd better have one, because his wife of nearly 25 years is divorcing him, and that settlement could make her, in an instant, one of the wealthiest women on the planet. gemma allen is a partner in a family law practice in chicago. when they began that business 25+ years ago, it wasn't much of a business, and she helped build it. say she has a 25% right to his assets. is that binding when she could probably claim 50%? - i would need to know when the prenuptial was signed, what the terms were, did she have a lawyer, duress, etc. but i'll bet she could afford a good team of lawyers to challenge the prenup, and my bet is the confidentiality is so meaningful that this case will settle between them some way or another, whether or not there was a prenup. - so are prenups ironclad, or
can they be breached? - getting more so, bill. i think historically they were less favored in the law, there was a lot of second looking at a prenup to look later to see if it was fair at the time it was signed. nowadays the law favors enforcement of the prenup, so you should be very careful about what you sign. - now, a prenup, can they be modified, updated during the marriage? - absolutely. and that is the thing that people should really realize. they can be modified, adapted, there can be a post- nup agreement even if you didn't have a prenup in the first place. people can sit down and say, "listen, this is where we are, we have different views about what should happen with our money as we get older. let's settle that issue but stay together." - so a post-nup, that is after you're married. - after you're married, you can modify it - there is a prenup that can be modified - and many times over - it is your life, it is your agreement with your spouse. you can do a post-nup
if you never had a prenup. and that is, again, your agreement with your spouse. you can do it. - i have got to ask you about this horror story with kim kardashian and her boyfriend kanye west. they are about to have a baby, yet she is technically married to this other guy, kris humphries. what a complicated mess! what would you do if you were the lawyer and you were advising one of the parties here? - i would advise her to expedite the divorce, which i'm sure she is trying to do- - that is, before the birth? - absolutely. it is better if you are divorced before the birth of your child with another person, yes. but, in case that is not possible, i would still be able to tell her the presumption would ordinarily be that her husband was the father, but since she is living with kanye west and they have been together for awhile and he has acknowledged the baby, they can overcome that presumption. - gemma allen. now i know why there are lawyers in the world, to explain all this. thank you so much. - thank you bill. still ahead, lionsgate stock is roaring. a look at the film studio's success next in movies and money.
"g.i. joe" won the battle at the box office over the weekend, but there is some behind-the- scenes manuevering we are going to talk about with our movies and money guy, erik childress, who joins us now. good to have you on the show. - thank you. and - so no surprise, "g.i. joe." you predicted this one. - not at all. we were talking last week about the international numbers and how important they are. after four or five days of release, "g.i. joe" has over $50 million here in the states, but it had the largest debut internationally for the year, over $80 million. so it should be enough to get paramount in the black for that movie. - it is going global. here is a look at what happened at the box office last weekend: "g.i. joe:
retaliation" coming in at $40.5 million. "the croods," number 2, "tyler perry's temptation" at $21 million - we will talk about that in just a minute - and "olympus has fallen" and "oz, the great and powerful" coming in at number 5. now, tyler perry was a scene-stealer this week. [erik laughs - it was a surprise! coming in at number 3. - the amount was a surprise. i think the placement wasn't too much a surprise. i was expecting maybe around $15, $16 million, because we kind of joked last week that you put tyler perry in the madea character, his numbers are usually a lot higher, and this one doesn't have that, it is more of a straightforward drama, and the numbers were pretty extraordinary. - and because this is the 9th time that mr. perry has come in above $20 million, he now joins the ranks of steven spielberg- - and robert zemeckis. two of my favorite directors of all time coupled with one of my least favorite directors of all time. - you go tyler. - no. go away. - meanwhile, lionsgate stock, up almost 70% for the past year. not too shabby. it's
trading just off its highs. moving on to what is coming up this weekend, "evil dead." [erik laughs - it is interesting that the marketing for this movie is saying that it is the most terrifying experience you are ever going to have in the theater, which is probably true if you have never seen a movie in a theater before. i don't think the movie is that great. it is a remake of the 1981 original by sam raimi. i think it is going to do very well this weekend though, i think it will be number one. horror fans come out in droves for it. - and "jurassic park 3d." - i am actually a lot more excited about this. it is the 20th anniversary. we have seen these 3d movies kind of getting taken off the schedule left and right by theaters after "lion king" did very well and then some of the other once didn't do as well. i think this one could surprise. we saw "titanic" in the same slot last year do $17 million. i think this one could have a really nice number this weekend. - and my all-time favorite scene when they first see the dinosaurs. - the brontosaurus. special effects history right there. - and one last mention before you take off, you have a film festival coming up. - yes, april 12th to the 14th next weekend at the movieco theaters in rosemont, the chicago film critics' association is presenting the
first ever chicago critics' film festival. we are going to have a lot of special guests there, sarah polley is opening, william friedkin, the director of "the french connection" and "the exorcist," will be there. tickets and passes are available now. it is going to be quite a weekend, so please show up for it. - and of course we are all pulling for and praying for roger ebert, who is changing his schedule because his cancer has returned. - absolutely. no one probably in any other profession has probably influenced more generations to continue in his footsteps than roger ebert, so we absolutely wish him the best. - and he is such a fighter. - absolutely. - good to have you on the show, erik. thank you. coming up, what traders see in the charts ahead of friday's jobs number. don't miss it. we will be right back.
record closes this week, with the s&p 500 closing at an all- time high on monday, as well as the dow. what are the numbers telling you, dan? - it is interesting angie. like you said, you pointed out that those are kind of the headlines you see across the board, but the fact of the matter is i know some technicians are still watching very closely that intraday high that we saw in 2007. october 2007 we saw an intraday high in the s&p of 1576. monday we got very close to that, and we saw some selling once we got up to that point, and then the market wasn't really able to recover. yesterday we saw further selling because of the fact that the economic numbers coming in this week have been pretty disappointing, particularly that adp number leading up to unemployment at the end of this week. - right, adp coming in at 158,000 jobs, they were looking for closer to 200,000. so what can investors expect from here? will we see a situation where the market just keeps hitting these resistance lines for awhile? - it is possible, angie. we
will have to see how it handles these next couple of days. of course, all eyes are going to be on the unemployment number coming in on friday. there were some hints by some of the fed officials again about quantitative easing moving forward. i think that rattled the market. and that, coupled with the fact that we do have this cyclical pattern that we are starting to close in on at that "sell in may and go away" kind of pattern that we have seen kind of come to fruition the last three years, so i think we have got some anxiety there as well. nonetheless, right now, the market, some consolidation here isn't all bad. if the number comes out and reverses this trend in these economic numbers that have been coming out on friday in the unemployment number, we certainly could see them push through possibly 1576 in the s&p. - thanks a lot dan. have a good day. - thank you. that's it for now. coming up tomorrow in traders unplugged, should you energize your portfolio with coal stocks? find out on friday. from all of us at first business, have a terrific day!